Regulatory Compliance and Solution Traceability, Regulatory Gap Assessment
We carried out a detailed gap analysis regarding MiFID I and the then-upcoming MiFID II for our client, creating a framework to correctly classify transactions and the key factors to qualifying trades.
Our expertise with front office trading systems and businesses, along with a deep understanding of the regulations, allowed the project to start after conversations with key IT and business stakeholders. We identified and documented all business flows and the implications of the new transaction reporting requirements.
Conducting a detailed gap analysis between existing reporting requirements under MiFID I and the additional requirements under MiFID II, by creating a transaction reporting analytics framework.
Our first step was to explore the problem statement shared by our client and learn about their requirements. The goal was to share our expertise as the client lacked the framework for transaction reporting analytics.
In the next phase, the assembled team of experts worked towards developing a strategic plan on how to carry out the detailed gap analysis regarding the MiFID I and then-upcoming MiFID II and its subsequent reporting.
Our initial discovery highlighted numerous outdated rules in MiFID I which required cleaning. Our customized framework allowed us to identify large gaps in the documentation which would've made future MiFID II auditor/regulatory compliance evidence difficult. In compliance with ESMA guidance, we determined, placed, and validated the proper fields' values.
We successfully delivered data consistency per the set standards and best practices. Our framework ensured proactive processes for addressing data quality problems. Ensuring continuous compliance, we provided full transparency through technical documentation. To increase accessibility and feasibility, we further simplified testing/monitoring of transaction reporting.
We applied our expertise to successfully identify and document all business flows and the implications of the new transaction reporting for our client. We ensured that all required information was readily available in the transaction reporting system and helped create new data streams from the trading system.